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Successful startups are good at marketing. All successful startups find the sweet spot combining what their offering does, who for, why customers use it vs. other options, what they pay for it, why customers keep using it, and how potential customers know about it, all of which are marketing activities.

You wouldn’t know a startup needs to be good at marketing from the media which usually focuses on the technology, preferably new and cool; the revenue model; and/or the personality of the founder(s).

The risk if you don’t focus on marketing from the beginning, is wasting time and money going in the wrong direction, and it  harder to correct course later, when you might have burned through most of your capital. Marketing is no less important to those using lean startup techniques. Once you have a ‘minimum viable product’ in the market, to learn and iterate your offering you need to both understand and contextualise the feedback you are getting. If you don’t understand why something isn’t working, its hard to know what to replace it with.

If you are able to run a very large number of experiments across a relatively specific area, like say website design, you may not need to know why something works or doesn’t, you can absorb the result and move on. But if your field of endeavour is broader with a lot more variables – like what features should our product have, who are our target customers, why would they want to consume our product, how do we make it compelling for them to do so – you need to be able to contextualise your findings and build a body of knowledge about the what, why, who, how of what you are offering.

This difference between startups who understand marketing vs. those who don’t is usually pretty obvious. Email marketing is a good place to see this difference. Non-marketing-focused technology companies send out ‘here are our neat new features’ emails, where marketing-focused companies send emails that are useful and improve the customer experience. Quora sends a well-chosen weekly selection of content from its site that never fails to get me, and many others, clicking through. LinkedIn helps users keep connected with their networks by summarising contacts’ job changes and profile updates, as well as articles posted by people you follow. Even better, LinkedIn emails turn a 10-minute daily scroll through the homepage, into a 30-second scan of a weekly email.

So how specifically does marketing help startups? A snapshot is in the below table. There is a rough logical sequence to marketing activities although building a successful startup is a highly iterative process. It makes sense to work out the purpose of your offering (‘what job are users hiring it do’, in the words of Clayton Christensen) and who will use it, before working out sales channels. Some aspects like pricing will be iterated throughout the process although there are a few traps, e.g. if start with a price of ‘free’, it is hard to start charging later, unless you can create a freemium upgrade path.

Start-up stages Marketing questions and activities
1. New concept
  • Who might the concept be useful to and why? What purpose(s) might it fulfill or job(s) might it do for who in what situations?
  • What solutions are being used for these purposes and jobs now? How adequate are they, considering functional, emotional, and social needs? Are there also adjacent jobs for which the current solutions are inadequate?
  • How big might the market(s) be?
  • What might the revenue model be?
  • How do we test answers to these questions?
2. Prove concept
  • Talk to and observe potential customers, including customers and non-customers of competitor solutions.
  • How can the target market be addressed: what sales channels, and what positioning to simply and memorably convey the purpose?
  • What product-purpose-customer configurations should be tested in the prototype (‘minimum viable product’) stage?
  • What is the initial profit formula?
3. Prototype | Pilot
  • What are the key metrics that define success?
  • Gather and analyse market feedback. What is it actually telling us about our offering, its purpose and the job it is doing for customers? Is the purpose different than we originally thought?
  • What are we learning about the functional, social, emotional needs of customers and what does that mean for our business model?
  • What is the initial price and how will we test it? Can we try different revenue models (subscriptions, usage-based, micro-pricing, etc)?
  • What are we learning about which customer groups are the largest / easiest to reach / have the greatest need for the new offering?
4. Commence production
  • Develop brand, logo, tagline that clearly and compellingly express the purpose.
  • Test social media engagement models.
  • Test sales channels. Monitor conversion rates and costs. For B2B offerings, create and prioritise initial target lists and sales collateral.
  • Test promotion strategies for success at raising awareness and sales. A very few start-ups are able create a lot of media buzz, most need to rely on other options.
5. Commercial production
  • Business-as-usual marketing activities.

If you are thinking there is nothing very mysterious here, you would be right. Like many things though, the trick is knowing when to work it out for yourself through trial-and-error, and when its better to get someone with experience who knows how to do it quickly and effectively, as well as the shortcuts and traps for the unwary.

Happy venturing!

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